Today’s episode is brought to you by Orion Advisor Services, the industry’s premier portfolio accounting service provider for advisors. Orion integrates with several automated investment platforms, but you’re not sure if now the right time to add a robo element to your firm.

Find out if you’re ready, or not, to add your own solution by downloading a free copy of the Orion pre-robo checklist today by visiting fppad.com/robochecklist.

[This week’s top story is all about Betterment, because in the wake of last week’s Brexit vote, the company notified financial advisors on the Betterment Institutional platform that it had suspended trading from 10am to 12pm Eastern on June 24th, citing their expectation of “highly unpredictable volatility,” a decision which has triggered all sorts of discussions across the investment community.

First, a primer. Betterment uses ETFs for all customer portfolios, and when trading gets volatile, ETF pricing can get significantly disconnected from the value of the ETF’s underlying securities. Remember the flash crash of August 2015? ETF pricing was all over the map, especially for lightly traded and illiquid ETFs.

So, when Betterment’s team identified undesirable trading conditions, they suspend all trading. And as a discretionary advisor to retail customers, they can totally do that. It’s disclosed right there on page 65 of the retail agreement, which every customer acknowledges they read by checking the I agree box next to the Sign Up button. <wink wink>

But the exact same language is on page 70 of the Institutional Agreement, and I couldn’t find anything that said trading *authorized by the Advisor* would be treated any differently. In the RIABiz coverage of the event, Michael Kitces said that treating financial advisors the same as clients “creates operational channel conflicts.”

And there’s the rub. If you’re an advisor using Betterment Institutional for your clients, when you authorize trades, you need to know whether those trades will be subject to Betterment’s suspension criteria.

But that’s one risk of using ETFs in Betterment Institutional, or any automated investment service for that matter. Sometimes the pricing gets out of whack, and you won’t always know in advance when that happens.

So on a volatile day, you need to understand that, as of today, your trade authorizations might not be processed right away, and your trades will be in limbo for who knows how long until Betterment decides it’s ok to resume trading. I suspect that policy might soon be changing for Betterment Institutional users.] Betterment, LLC, a pioneer in the world of automated investing, made an unusual move and suspended all trading Friday morning as markets were roiled by the U.K.’s vote to leave the European Union.

[My next story highlights TD Ameritrade Institutional, as I attended the custodian’s 7th annual technology summit in Dallas, and I made a vlog about it so you can get a glimpse of what the event is like, so be sure to check it out.

At the summit, executives offered updates on Veo Open Access, which now features 104 integrated solution providers, announced the introduction of Veo Advanced Alerts, and reiterated the pending release of the Veo One platform for late fall of this year.

There weren’t very many advisor dashboards available when Veo One was first announced in January of last year, but recently several tech providers have invested heavily in their own all-in-one dashboards, with notable names like Envestnet|Tamarac, supported by Envestnet’s acquisitions of Finance Logix and Yodlee, Salesforce, with its rollout of Financial Services Cloud happening now, and Fidelity’s Wealthscape platform anticipated by the end of this year, which will include technology from the eMoney acquisition.

So Veo One will go up against some stiff competition when it is rolled out later this year, so I recommend you make plans now to refresh what you know about the dashboard options for your business in the second half of this year.] A growing community of technology innovators, which has collaborated with TD Ameritrade Institutional1 to make Veo Open Access one of the industry’s leading platforms for independent registered investment advisors (“RIAs”), is again coming together to drive significant new enhancements to Veo and accelerate the pace of future Veo One integrations.

Junxure, the industry leading CRM solutions and technology company for financial advisors, this week announced new enhancements to its cloud-based CRM platform, Junxure Cloud®. As part of its ongoing work to integrate with leading platforms serving independent registered investment advisors (RIAs), Junxure Cloud has expanded its integration with Veo®, TD Ameritrade Institutional’s comprehensive trading and account management platform.

Vestorly Inc., the leading content marketing and relationship analytics platform in the financial services industry, today announced a unique partnership with Dow Jones that will enable all Vestorly users to access Dow Jones content, including The Wall Street Journal, in order to engage clients and generate leads.

First, a heads up, Steve and I will be on the road later this month covering the massive NAB 2016 event, scouring the exhibit halls for technology you can use to make great videos and podcasts, followed by the 2016 Shareholders Service Group conference in San Diego. Visit fppad.com/subscribe and sign up today so you don’t miss any of our coverage from the events.

[Now on to this week’s top story which comes from Betterment, as the automated investment service raised another $100 million dollars in venture capital, bringing the total amount they’ve raised to $205 million. Betterment is pulling away from a crowded field of robo competitors, now servicing over 150,000 customers, managing $3.9 billion in assets, and valued at a reported $700 million.

Betterment says they will use the funding to grow the Betterment for Business 401(k) platform and the Betterment Institutional offering for you, the financial advisor.

But despite all the money raised and what they say about being their customer’s central financial relationship, Betterment’s questionnaire still doesn’t tell customers that they should pay off high interest credit card debt or build up an emergency fund first before investing. Oh, that’s right, customers can find that advice somewhere on the blog.

So I’ll reiterate what I posted on Twitter this week: Betterment, I hope you use the money to make unbiased fiduciary advice accessible & affordable to everyone.

If you want to read more about the latest round of Betterment’s funding, head over to fppad.com/183 for the links to this week’s top stories.] Today marks an important milestone for Betterment and our more than 150,000 customers who have invested over $3.9 billion with us. We’re excited to announce that Betterment has closed a $100 million investment, led by a new partner, Kinnevik.

[Next up is news from Fidelity, as the company announced plans to begin testing Fidelity Go, its own automated investing service for retail investors, with roughly 500 customers this week, with an official rollout sometime in the second half of this year.

If you remember back to November of 2015, Fidelity broke off its relationship to promote Betterment Institutional to advisors, and then coincidentally announced the Fidelity Go retail product that competes more or less with Betterment. Fidelity Go will feature investment portfolios managed by Geode Capital Management, all in fees at 39 basis points or lower, automatic rebalancing, but no tax loss harvesting.

With Fidelity Go as a retail offering, you should know that Fidelity told me that a B2B version is under development, and while they couldn’t give me a solid release date, they did say the offering will be customized to your needs as an advisor.

Nevertheless, Fidelity joins Charles Schwab as an institutional custodian with an automated investment solution in the retail space, but at no platform fee in exchange for a little extra cash allocation, Schwab Intelligent Portfolios, in my opinion, is going to be tough to beat.] Fidelity Investments, the second-largest U.S. mutual fund company, will test an automated-investment service starting Wednesday on a small group of existing customers. Fidelity plans to offer the service to the public in the second half of this year.

[And speaking of Schwab, this week’s final story is news that Schwab Advisor Services is discontinuing the Schwab OpenView Integrated Office solution effective July 31. Roughly 150 firms are using the solution, so they’re going to have to find some other technology to replace Integrated Office, specifically the custom version of Salesforce that came with it.

The link to the story at fppad.com/183 has the details on options for affected advisors, including using Salesforce with Schwab OpenView Gateway or migrating to a completely new CRM, but here’s the angle I want to focus address.

This is absolutely an example of what can happen when you choose a custodian’s proprietary solution for a part of your technology. How committed is that custodian going to be to offer that technology over the lung run? In this case, Schwab, for whatever reason, is shutting down Integrated Office, leaving 150 advisors with just three months to figure out what to do.

So I don’t blame you one bit for getting a little uneasy when custodians offer proprietary technology solutions to you that they own and control. But with more custodian acquisitions of technology on the horizon, I’m afraid this is a risk you’re going to have to assume more frequently as time moves on.

One more thing: if you want a firm with Salesforce experience in financial services, get your pencils out, because you should consider contacting LiquidHub, Concenter Services, Navatar, Salentica, or AppCrown.] One hundred fifty Charles Schwab advisors must find a new client relationship manager (CRM) by July 31.

Laser App Software, the premier provider of forms automation and management software for the securities and insurance industries, has announced that Advyzon, an all in one cloud-based platform combining portfolio management, performance reporting, CRM, client portal and planning, integrated with Laser App Software to enhance its client dashboard.

Our team has been hard at work creating the AdvisorQA mobile product experience for Financial Services. It provides a new mobile Content Management and Social Collaboration tool that utilizes the cognitive computing and research capabilities of IBM Watson.

Intuit identified Finicity as a solution that will provide a “façade” API interface that translates Intuit-structured API calls into Finicity-structured API calls.

Financial Data API Backstory

The Financial Data APIs from Intuit allow developers to link to end-users’ banking accounts from within their application.

In September of 2012, Intuit announced that it was opening up the technology that powered Intuit products like Mint.com, Quicken, and QuickBooks to the developer community via a library of APIs that it called Customer Account Data (CAD).

Customer Account Data, which was rebranded Financial Data APIs, is composed of two separate products: the Transactions API and the Identification API Beta.

The Transactions API offered connections to roughly 20,000 US and Canadian financial institutions, enabling third-party developers to quickly and cost-effectively deploy aggregation functionality to a wide array of financial sources.

The Identification API Beta facilitated customer’s identity and banking account verification using banking credentials. Developers were able to configure ACH connections via the API instead of relying on microdeposits (a series of deposits under $1 that the customer verifies) and a process called “fatfingering.”

FinTech Floodgates

The general availability of the Intuit Financial Data APIs opened the floodgates of all sorts of new B2C fintech startups that featured the aggregation of users’ financial accounts. These startups included popular names such as LearnVest, SaveUp, Hello Digit, BillGuard, and more.

A similar increase has taken place among B2B account aggregation providers, with companies like Blueleaf, Wealth Access, Quovo, Plaid, and Right Capital all appearing with some type of advisor aggregation fintech solution over the last four years.

Prior to the new wave of account aggregation providers, advisor solutions were dominated by four key players:

Betterment (retail and Institutional, based on their use of both Plaid and Quovo)

Note: Prior to August 30, 2016, I had Right Capital in the list above. After connecting the Right Capital co-founder Shuang Chen, I learned the company had considered Intuit’s API for aggregation at one time, but ultimately decided to engage Yodlee for account aggregation. Therefore, Right Capital will not be affected by the Intuit API shutdown.

In its press release, Intuit identified Finicity as an alternate provider of aggregation services.

We have identified a new aggregation partner, Finicity, for whom this service is a core part of their business. Finicity can offer long-term benefits and service for our aggregation customers. To minimize developers’ engineering work to switch APIs, Finicity will provide a façade API interface that translates Intuit-structured API calls into Finicity-structured API calls.

The “façade API interface” means that developers with existing code that calls on Intuit APIs will not need to change their codebase. Instead, Finicity will publish an API interface that is 100% compatible with existing calls to the legacy Intuit APIs and return data to the developer’s application as if Intuit’s APIs never went away.

Who is Finicity?

For me, Finicity is a newer name in aggregation that came to my attention last year while monitoring Quora for details on Yodlee despite founding the business in September 2000.

While the Finicity compatibility endorsed by Intuit sounds good for existing developers, there are certainly other issues to consider before building a business on top of Finicity services, and that absolutely should factor into the due diligence process of advisors.

2015 has been a good year for Finicity. We’ve signed hundreds of Fintech and Financial Institutions to build their solutions on our API, have quietly launched over a dozen partners, and are launching dozens more in 2016. Our partners tell us that our broad native data source coverage and our fanatical agg support teams are the primary reasons why they love us.

-Nicholas Thomas

So with relatively little marketing (e.g. as I published this, their most recent tweet was on October 27, 2015), Finicity managed to sign up “hundreds” of customers, launched “over a dozen” partners, with more on tap in 2016.

Is account aggregation Finicity’s only play in the industry? No.

To see what other lines of business Finicity offers in addition to their aggregation services, their website lists two other divisions: Mvelopes and Money 4 Life Coaching

Mvelopes from Finicity

Mvelopes is a software application for personal budgeting and has extremely high ratings for its apps in the app stores. Surprisingly high, actually (more on this later).

Mvelopes allows users to create virtual envelopes for different spending categories and allocate money to them accordingly. The idea is that throughout the month, users refer to the amount of money left over in each envelope after paying bills in order to preventing overspending. Transactions are aggregated from connected accounts, and transactions are automatically deducted from applicable virtual envelopes of available cash.

The service is free to use with a limit of four aggregated cash flow and credit accounts (here’s the Finicity aggregation connection). To access unlimited accounts, users subscribe to the Mvelopes Premier plan for $95/year.

Money 4 Life™ Coaching

Where things get more controversial for me is Finicity’s division called Money 4 Life™ Coaching. The Mvelopes pricing page makes the first mention of coaching services and describes how customers can benefit from one-on-one coaching customized for individual needs.

So I looked into this coaching services with a quick Google search and came across quite a few consumer complaints (36 to be exact) about the services on the Better Business Bureau website.

Most of the complaints seem to be centered around the Money4Life coaching including allegations of no contact by coaches for months at a time and allegations of cancellation difficulties.

Most complaints listed on the BBB site appear to reach a satisfactory conclusion once customers initiate the dispute process (which results in an overall BBB rating for Finicity of A+) , but it is surprising that many customers feel that they need to involve BBB in the first place in order to reach a resolution.

Also, the Mvelopes mobile app ratings are overwhelmingly positive, but many of the five-star reviews have no details in the description or come from users with no other app reviews other than Mvelopes. It’s eyebrow raising.

Critical Mvelopes app reviews such as the one below from iTunes are enlightening:

I contacted Finicity for comments and have not yet heard back from the company, so I will update this post accordingly.

What’s Next?

So what’s next? Given Finicity’s connection to awkward customer experiences under the Money4Life coaching program, how likely are the younger aggregation providers to migrate their API calls to the Finicity API? Or will there be a trend to simply abandon the aggregation of financial institutions currently covered by Intuit?

No matter what, as the aggregation vendors make their decisions behind the scenes, advisors’ clients will need to reauthenticate their usernames and passwords once a migration to a new aggregation service is implemented.

For some firms that have a handful of aggregation accounts, this may be a non event, but for larger firms with thousands of aggregated accounts, the issue could take weeks or months to resolve as all clients work through their accounts to reauthenticate their login credentials.

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[Alright, my coin flip came up heads, so this week’s top story comes from Salesforce, as the world’s largest provider of CRM software officially released Salesforce Financial Services Cloud. Earlier this week, the company hosted a live broadcast with United Capital CEO Joe Duran to demo the new platform.

I used Periscope to broadcast myself watching the Salesforce broadcast and gave my real-time reactions to what I saw, so if you’re a subscriber, look for the link to that video in my email newsletter. If you’re not a subscriber, well?

So let me cut to the chase. The CRM is built on the all new Lightning product, which for you means the Lightning Experience delivers the same look and feel of a fresh, modern interface across any device you use. Lightning also simplifies the creation of new apps, because third party developers build those apps around the Lightning Design System that enforces consistency across the platform. That’s good.

But, did I see any new features in the demo that Salesforce doesn’t already have today? No. What I saw is more data, in really tiny font size, consolidated into customizable dashboards.

Look, Financial Services Cloud is the framework, the foundation, for new features, but there’s nothing that I saw out of the box that screams “oh my gosh I must have this right now!”

And on top of that, Duran said that United Capital will be releasing a their own version of Salesforce that advisors can white label. What?

So if I understand that correctly, you subscribe to Financial Services Cloud for $150 per user per month, but then you’ll need to get a white labeled version to take advantage of features United Capital built for RIAs? How much will that cost?

And then you have a number of other third party providers announcing their own extended capabilities for Financial Services Cloud, which includes Orion Advisor Services, Advisor Software, LiquidHub, Smarsh, and many more.

I have got to be missing something here because it’s just not adding up for me. Will any of this news be enough to attract conversions from advisor-focused providers like Redtail, Junxure, Wealthbox CRM?

I don’t know, you can read all about Financial Services Cloud and the third party extensions over on the website at fppad.com/182, then send me a tweet, I’m @billwinterberg, and tell me what you think.] Salesforce, the Customer Success Platform and world’s #1 CRM company, announced today the general availability of Salesforce Financial Services Cloud.

[Moving on, my next story comes from Betterment, as the automated investment service announced this week that it is rolling out account aggregation capabilities to users of both the retail and institutional platforms.

This means that Betterment customers can now connect their held-away investment accounts like 401(k)s and 403(b)s as well as their bank, credit card, mortgage, and personal loan accounts to the automated service and see everything in one place, all for no additional fee.

The aggregation is powered by Plaid and Quovo, which, if you follow me on Twitter, the latter is a partnership I tipped my hand about back in November. Is this the part where I brag about my predictions? That’s right, that’s not my style.

Anyway, this doesn’t outright replace other PFM services like Mint.com, YNAB, Personal Capital, or LearnVest because those services aggregate individual transactions, where Betterment aggregates only balance and holding information. Well, at least for now.

But it does mean that more and more investors are going to expect to see all their assets and liabilities in one place. If you’re not using solutions like Morningstar ByAllAccounts, eMoney, Wealth Access, Aqumulate, Quovo, or Yodlee inside of MoneyGuide Pro, well, you’re at a competitive disadvantage.

And Betterment isn’t adding aggregation out of the kindness of their heart. It’s totally an asset gathering strategy because they’re telling customers they have too much idle cash sitting in a bank account or the mutual funds held in a brokerage account have high fees.

Oh, I can only imagine what those pop ups might look like. That reminds me, click to pop up to sign up for the FPPad newsletter!

Alright, alright, that’s enough snark for one episode, so let me wrap up by saying this. You are in a technology arms race, and I want you to keep reinvesting in your business and adding the right technology, which is why I make FPPad Bits and Bytes to keep you up to speed.] Now when your clients sync their outside accounts with Betterment Institutional, you can see details about all of their investments, including fund allocations, holdings, fees, and cash.

To help people identify new ways to save for retirement and change problematic spending behaviors before it’s too late, Personal Capital, the leading online financial advisory firm, has issued its inaugural Spend Report.

[This week’s top story features Betterment, as the automated investment service announced the official launch of Betterment for Business, the company’s 401(k) plan for employers.

Earlier this month, Betterment for Business received a very strong endorsement from the founder of a start-up called Estimize, saying the plan was so easy to set up that it could potentially crush the 401(k) industry.

With plan fees ranging from 60 basis points all the way down to 10 basis points for billion-dollar plans, and an interface built for ease of use, Betterment’s offering might actually be one that you recommend to your small business-owner clients, and you might even consider it for your own company’s 401(k) needs.

Among large 401(k) plans, established providers like Vanguard, Fidelity, and Financial Engines have a sizable advantage, but underserved companies establishing their first 401(k) plan should see Betterment as a very attractive solution.

This reminds me of how Betterment targeted young underserved investors back in 2010… huh.] Betterment, the largest automated investing service, today announced the official launch of Betterment for Business. The new 401(k) platform, which uses smarter technology and includes personalized investment advice for all plan participants, is now live for a charter group of plan sponsors and participants.

Started our 401K plan for @Estimize with @betterment today, was so easy to set up, amazing product, gonna crush that industry

Today, we’re making Office even easier for customers to use with cloud storage providers by adding real-time co-authoring with Office Online for documents stored in partner cloud services, extending our Office for iOS integration to all partners in the CSPP, and enabling integration between Outlook.com and cloud storage providers Dropbox and Box.

[This week’s top story comes from Jemstep, as the B2B online investment platform was acquired by Invesco, the $800 billion dollar asset manager based a stone’s throw away from my studio right here in Atlanta.

Terms of the deal were not disclosed, Jemstep’s leadership will stay onboard to run the Invesco subsidiary, and for now, the company says there won’t be any changes to existing partnerships, custodians, or asset availability in model portfolios.

Ignoring B2C acquisitions of FutureAdvisor and LearnVest, the last twelve months have seen John Hancock acquire Guide Financial and Envestnet acquire Upside.

So who are the independent B2B providers left? I see Autopilot, Trizic, Oranj, Vanare, Betterment Institutional, Motif Investing, and to some extent, the roll-your-own open source platform from Wealthbot.] Invesco Ltd. has acquired Jemstep, a market-leading provider of advisor-focused digital solutions.

[But hold on! Sending shockwaves in the retail robo space is Snapchat, as rumors were flying this week that the ephemeral chat app might introduce it’s own investment service to its 100 million active daily users.

Uh, let me explain my thoughts in a brief demonstration… Get it, jump the shark?] Snapchat is understood to be at the front of a queue of tech firms developing Robo-Advisory technology – which uses algorithms to help users develop and implement customized investment strategies for retirement planning.

[But wait, there’s more! In its first move after being acquired by BlackRock, FutureAdvisor announced it is partnering with BBVA Compass to roll out the automated investment tools to the bank’s nearly 700 branches in the US.

Bank customers will get access to FutureAdvisors’ digital investment management for the standard fee of 50 basis points, and you can probably bet that new accounts opened up with be held with BBVA’s broker-dealer affiliate, which is how the bank capitalizes on the partnership.] BBVA Compass, the Sunbelt subsidiary of the Spanish banking giant, has announced it will partner with FutureAdvisor to offer its customers digital investment management, popularly known as Robo Advisors. It is the first major bank to sign on with FutureAdvisor since the advisory firm combined forces with BlackRock, the giant asset management company, last year.

[And if you’re not sick of robos by now, let me add news from Wealthfront who this week released a free Portfolio Review service to show investors how bad their current portfolios are and urge them to save a boat load of money by switching to Wealthfront. Whoops, did I say that out loud?

This concept is nothing new, as Personal Capital has offered a similar portfolio analyzer since 2011, and FeeX has been doing it since 2012, but here’s the deal. These VC-backed companies are spending tons of money to target your clients and prospects to get them to try out this tool, and of course, they’re going to tell clients they have suboptimal allocations and are paying high fees to their advisor.

So, expect clients to bring up fees, allocations, and performance in your next meeting, and you need to have a strong answer in the form of your value proposition, which is all the added advice, guidance, and behavior management you deliver that the automated services are incapable of providing.] In a bid to attract more assets, Wealthfront Inc. is joining other robo advisers in providing free advice to investors about their accounts at other financial institutions.

Here are stories that didn’t make this week’s broadcast:

Laserfiche just released version 10 of its enterprise content management system (ECM). Speaking at the Laserfiche Empower 2016 Conference in Long Beach, Calif., Laserfiche President Karl Chan said the new version is designed to supercharge content-driven business processes, enabling enterprises to redesign the flow of information throughout the enterprise.

Dashlane is one of our favorite password managers, and today the service updated with a new, consistent interface across all devices, an updated “password changer” that lets you change passwords on a site without even visiting it, new languages, and more.

On today’s broadcast, Pershing partners with a new company for your digital advice delivery needs, Wealth Access continues its growth in the PFM space, and find out how open source code called Wealthbot could pose a serious challenge to automated investment services.

[Let’s jump right in to this week’s top story with a recap of the Pershing INSITE conference held in Orlando last week, as one of the top institutional custodians for advisors made several technology-related announcements. First up is news of a partnership to allow advisors to offer their own white-labeled online investment service which will be powered by a company called Marstone.

Now if the name Marstone doesn’t ring a bell, don’t worry, because it’s only the second time I’ve even heard of them after a chance encounter I had with company executives at the IBM World of Watson event last month. In fact, the company is so new that their latest Form ADV disclosure shows assets of just $15,500 held in two clients accounts. That’s right, two accounts.

Now the few screenshots available from the Marstone website show a reasonably attractive interface, but with a retail investor offering that’s still in beta and an advisor solution that has yet to roll out, it’s just too early for me to say whether or not Marstone is going to gain wide adoption among advisors, especially when there are more seasoned competitors out there like Jemstep, Betterment Institutional, Oranj and more.

But, Marstone will be the first of several anticipated solutions that will integrate with Pershing’s NetX360 platform for advisors as well as the NetXInvestor solution for end clients.

Pershing also announced a new managed account solution called Managed360 that will leverage investment strategies and managed portfolio offerings from Lockwood Advisors, which also happens to be an affiliate of Pershing. Also coming in the future is a Pershing API store which is a catalog of APIs along the lines of the TD Ameritrade Institutional Veo Open Access platform, allowing third-party providers to more easily integrate with the Pershing ecosystem.] At its INSITE™ 2015 conference, Pershing LLC, a BNY Mellon company, today announced a multi-faceted digital enablement strategy designed to revolutionize how advisors and investors work together in 2015 and beyond.

[Next up is news from Wealth Access, the Nashville-based provider of a personal financial dashboard for high net worth clients, as this week the company announced the growth of its business with seven new hires in the last few months, as well as a 350% year-over-year increase in total assets aggregated in the platform, a figure that now exceeds $20 billion.

You know that merger and acquisition activity in the personal financial management space this year has been on a tear, with Fidelity acquiring eMoney, Northwestern Mutual scooping up LearnVest, and John Hancock picking up Guide Financial, so Wealth Access is pretty much one of the last independent PFM platforms out there serving advisors that has no direct custodial or insurance company connection.So like I’ve said in previous broadcasts, you would be wise to keep an eye on this company.] Wealth Access, an innovative high net worth personal financial management platform for advisors, announced growing momentum in the adoption of the Wealth Access technology solution by advisors, with record year over year growth and the hiring of seven senior technology and financial services veterans.

[And finally, wrapping up the week is an interesting discovery I made on the Internet called Wealthbot. Now stick with me on this one. Wealthbot is open source code published on the GitHub repository that can be used to create your own wealth management platform.

Not satisfied with the commercial wealth management solutions available today? That’s right, you can now build your own robo advisor, I mean, automated investment service. Now developers should get excited about the possibilities here, but advisors using Wealthbot directly? Well, that’s probably not going to happen without significant help from programmers.

But here’s the thing: online services like Wealthfront, Betterment, Future Advisor, even Schwab Intelligent Portfolios have attracted huge amounts of attention and venture capital for their software-based investment algorithms. So what happens to the value of those companies when code that mirrors their functionality is published on the Internet, for free?

Could Wealthbot be the next WordPress, OpenOffice, or Firefox of robo advisors? That, ladies and gentlemen, is why you’re watching FPPad Bits and Bytes.] Wealthbot.io makes it easy to launch a Wealth Management Platform. Build and customize your very own version of a robo-advisor.

Welcome to this special edition of FPPad Bits and Bytes, the Best Tech of 2014! On today’s broadcast, this is my last show of the year, meaning it’s time to review the top technology news from the last 12 months that matters to your business. That’s right, it’s time for my Best Tech of 2014 awards.

Today’s episode is brought to you by ITEGRIA, providers of complete outsourced technology support, security, infrastructure and IT solutions exclusively for RIAs.

In their new book titled Red Flags, you’ll learn how to protect your firm from cyber-attacks, disasters, and IT compliance risks. Learn more about the Red Flags book by visiting fppad.com/itegria.

This week’s episode is all about my picks for the Best Technology of 2014. This is my fifth year highlighting top technology for financial advisors and wealth managers, and as always, I break down award winners into three categories: the best back office technology, the best client-facing technology, and the best overall innovation of the year.

Best Back-Office Technology

So let’s begin with the Best Back-Office Technology award winner, which is a product or service that boosts the overall efficiency and productivity of your back office and makes a direct impact to your bottom line.

Unveiled at Finovate Spring 2014 where it won Best of Show, the Motif Advisor Platform is a solution you can use to build, manage and rebalance your own motifs on behalf of clients. You can combine up to 30 stocks and ETFs into your own custom motif and trade the entire strategy for one flat fee.

Pricing for the Motif Advisor Platform starts at $20 per month per customer, so the Motif Advisor Platform takes top honors this year because it helps you be much more efficient when managing custom portfolios AND it saves your clients money in transaction fees that might normally be charged for trading individual securities and ETFs.

Honorable mention in this category goes to Riskalyze, for its enterprise Compliance Cloud risk-monitoring solution, and the TD Ameritrade Institutional Veo Open Access Dashboard, consolidating dozens of technology integrations into one highly-functional web-based screen.

Best Client-Facing Technology

Next up is the award for the Best Client-Facing Technology. Now the winner in this category must significantly enhance the client-facing elements of your business and facilitate your interactions with clients. Clients benefit from improved personalized service as well as an increased level of convenience when using such technology.

I think all of you will agree that the growth of online investment services has really upped the ante when it comes to the client-facing elements of your technology. So it’s no surprise that the winner in this category is part of the online investment providers, but for me, one of them just barely edged out the others in taking top honors.

Because Betterment has a solid track record on the consumer side with over 50,000 customers, plus it has the advantage of having Steve Lockshin providing direction for the company based on his experience in the independent advisor market with Fortigent and AdvicePeriod.

Now don’t get me wrong, I think the other advisor-focused solutions have an equal shot at significant growth in this space, which didn’t make the award selection process any easier. But the good news for you is that you have a number of choices in this low-cost online investment category when you’re ready to add this offering to your business model.

Innovation of the Year

And finally, the third category in my annual Best Technology of 2014 awards is the Innovation of the Year. This award goes to a product or service that introduces a new business practice or service experience to your business. This innovative tool should transform the way you interact with clients, enhance your overall efficiency, or even enable the delivery of new services not possible or practical in the past.

Out of all the new products we’ve seen in 2014, Engage is one of those solutions that I feel breaks new ground.

It begins with videos you create to communicate with clients, which you really should think about doing in 2015, but what Engage allows you to do it customize the video content you send to clients in an automated fashion.

Engage integrates performance data from Orion, graphic elements from MoneyGuidePro, and calendar scheduling from Redtail CRM, and embeds the information directly in your videos. So you only need to record one video, but Engage makes it seem like you created hundreds of videos, each with graphics and information specific to your clients.

It’s pretty cool stuff, and that’s a technical term, and a little ahead of its time, as a lot of you just aren’t ready to communicate with clients using video, which is why I feel Engage from Orion deserves to be recognized for its innovation this year.

Closing out this year’s award is an honorable mention to Gladstone Associates for their new streamlined business valuation toolkit that uses technology integrations to efficiently gather data about your business.

Your Feedback

So what do you think about my choices for Best Tech of 2014? Did I make the right choices, or did I completely blow it?

You’ve got to let me know! Leave a comment below, send me a message on Twitter using @billwinterberg, or leave a comment on the FPPad YouTube channel.

Thank you so much for being a part of the FPPad community throughout 2014, and I wish you all the best in 2015!

On today’s broadcast, Betterment Institutional releases its online investment solution for advisors. Will the industry rush to adopt this new digital solution for emerging clients? The SEC admits it doesn’t know where its laptops are. Could you be at risk of making the same mistakes committed by this industry watchdog? And, hackers claim to have stolen millions of passwords from Dropbox. Find out what you should be doing right now to protect the information you store online.

[This week’s top story highlights Betterment Institutional, who this week announced the official release of an advisor-friendly version of its popular direct-to-consumer service that currently manages over $600 million in customer assets.

No doubt influenced by the guidance and financial investments from Steve Lockshin and Marty Bicknell, Betterment Institutional allows advisors to white label the Betterment platform and offer it to all clients for a cost of 25 basis points per year. Advisors can charge an additional fee if they so choose.

In addition, Fidelity Institutional Wealth Services announced that the company will include Betterment Institutional among a list of practice management resources it offers to advisors. But the use of Betterment Institutional is not exclusive to Fidelity, so whatever your custodial affiliation is today, you can begin to use Betterment Institutional if you’re seeking a low-cost automated investment solution for your emerging clients.

Betterment Institutional joins Upside Advisor, Guide Financial, JemStep and a few others as an advisor-friendly automated investment solution, and you’ll want to stay tuned for news following the Schwab IMPACT conference, as details on that custodian’s much anticipated free investment platform should be made public.] If you can’t beat the robots, join them. That’s what Betterment—the ultra-low cost, computer-driven personal portfolio service—hopes financial professionals will do with its new institutionally focused “robo-advisor” offering.

[Next up is an embarrassing revelation from the Securities and Exchange Commission, as the industry watchdog admitted that somewhere between 24 and 202 laptops were unaccounted for, opening up the risk that private, nonpublic information could be exposed. Is this when I should do a forehead slap?

Alright, so the SEC has its own data security issues to deal with, but I want to take a moment to challenge you about how you’re keeping your business and client information safe. Do you use full disk encryption on the laptops you use for work? You should.

Windows 8.1 Pro and Enterprise offers BitLocker drive encryption for free, and if you use Mac, FileVault 2 disk encryption is built right in to the operating system. All you need to do is turn the feature on and protect your laptop with a strong login password.

And don’t forget about your mobile devices. Every device you use should be protected with a login passcode, the longer the better, and in most cases, requiring a passcode automatically enables device encryption.] The inspector-general of the Securities and Exchange Commission said in a report that there’s at least 24 and as many as 202 laptops that are not accounted for, which risks the release of sensitive, nonpublic information.

[And finally, Dropbox made headlines this week as reports circulated that hackers claimed to have accessed over 7 million usernames and passwords to the popular online file storage service. Dropbox insists that its systems were not hacked, but rather the login credentials were obtained from unrelated companies and services.

Once again, it’s critical that you follow good online account protection practices: Use a unique password for each website, activate multi-factor authentication where possible, and consider managing login credentials in a reputable password management service like LastPass, 1Password, Meldium, and more.] Dropbox was the latest company under the gun on security, when a link on reddit surfaced a claim that hackers have nearly 7 million usernames — plus their passwords — from the storage service on Monday.

Fidelity Institutional Wealth Services will list Betterment Institutional as a practice management solution in its list of resources for advisers

Betterment, a popular automated online investment service, today announced the expansion of its technology for use by financial advisers and an inclusion among Fidelity Institutional Wealth Services practice management solutions.

Betterment for Advisers

Betterment Institutional is an expansion of the startup’s popular online investment service built for retail investors. As of June
10, 2014, Betterment reported $613,372,319 in assets under management in its regulatory filings.

According to Nick Gavronsky, product manager for Betterment, the company’s new offering allows financial advisers to white label the Betterment Institutional offering and brand it for their own business. Advisers using Betterment Institutional will receive a website hosted by Betterment that investors can use to create accounts, view statements and engage with an adviser.

Initially, end clients using Betterment Institutional will use the company’s Android and iOS mobile apps as they exist today, but adviser-branded apps are anticipated to be phased in as the offering matures, Gavronsky said.

Low Cost Investments

Betterment Institutional will allow financial advisers to set their own fee schedule for clients who choose to use the service. Betterment collects an annual fee of 25 basis points (0.25%) from accounts on the Institutional platform, and any additional fees above that amount are paid to the adviser.

Just as with the retail Betterment offering, accounts are held by Betterment LLC, an SEC Registered Investment Adviser, and securities transactions are cleared through Apex Clearing Corporation.

Custom Models Welcome

Investors using Betterment’s retail offering are familiar with the standard asset allocation models the company’s algorithms select for clients based on their answers to a risk tolerance questionnaire.

Betterment Institutional offers the same investment allocation models to financial adviser clients, but the company also permits advisers to create their own custom models.

Again, the same technology that powers the default models in Betterment’s retail platform is available to custom investment models created by advisers, Gavronsky said in an interview.

In addition, investors who have $50,000 or more managed with Betterment Institutional have access to the same Tax Loss Harvesting+™ feature found on the retail Betterment platform. Tax Loss Harvesting+™ is an automated, daily account rebalancing feature.

Fidelity Touts Practice Management

Also noteworthy in the Betterment Institutional announcement is the recognition that Fidelity Institutional Wealth Services, providing custody services to nearly 3,000 RIAs, now includes Betterment Institutional as one of the practice management solutions Institutional Wealth Services offers to its RIA clients and prospects, according to Erica Birke, vice president of communications and corporate affairs for Fidelity Institutional.

“Fidelity Institutional Wealth Services and Betterment share an interest in helping advisors realize that digital advice should not be perceived as a threat, but rather an opportunity to evolve their engagement models to better attract new business segments, particularly the emerging affluent, a segment that many advisory firms have historically under-served or not served at all,” wrote Birke in an email.

Fidelity does not have exclusivity over the Betterment Institutional offering to advisers; any adviser is free to engage Betterment Institutional as he or she wishes.

Financial Adviser Value

Upside Advisor recently made headlines by powering Liftoff, the low-cost investment solutions offered by high profile New York RIA Ritholtz Wealth Management. Liftoff offers a similar model portfolio management service for an annual fee of 40 basis points (0.40%).